Activation of B cells, T cells, basophils, NK cells and mast cells by antigens is subject to potent negative regulation by the low affinity receptor for IgG (FcgammaRIIB). This negative signaling is mediated by FcgammaRIIB activation of the hematopoietic lineage specific phosphotyrosine phosphatase PTP1C. We propose to develop high throughput screens for the discovery of compounds that activate PTP1C for therapeutic use in allergic inflammation and as immunosuppressives. The screens will be based on the ability of a 13 amino acid immune receptor tyrosine based inhibitory motif (ITIM), found within the FcgammaRIIB to binds and activate PTP1C. One screen will identify candidate molecules which block binding of PTP1C-beta-galactosidase reporter fusion protein to the phosphorylated ITIM peptide. The second will assess the ability of compounds to stimulate PTP1C dephosphorylation of labeled substrate protein. Compound libraries to be screened will include non-hydrolyzable phosphotyrosine peptidomimetics and several derivative classes, and small organic compounds derived by combinatorial chemistry. Besides discovering new pharmaceuticals, our efforts may provide useful compounds for studying the function of PTP1C. PROPOSED COMMERCIAL APPLICATION: The proposal describes a project to develop assays targeting the hematopoietic restricted phosphotyrosine phosphatase PTP1C. This assay will be useful to identify potential drug lead compounds for allergy and inflammation.